Australian dollar


Macro Morning: Dijsselbomb

I had grave concerns about the Dutch Finance Minister Jeroen Dijsselbloem and his ability to lead the Euro Group and command the gravitas and experience necessary for that position. Overnight we saw that he is still wearing his L-Plates as he torpedoed the markets rally after the Cyrpus deal was announced. In an interview with Reuters and the


Macro Morning: Australian dollar roars

So the emotional roller coaster continues and the markets were worried about Cyprus again overnight. That is now four trading days where we have been worried, not worried, on and off. This suggests that Cyprus might be a convenient ex poste excuse rather than an ex ante cause but hey who am I to argue


Macro Morning: No volatility

The VIX volatility index hit its lowest level since 2007 overnight as the Dow printed another new all-time high and the troubles with Italy and the problematic Chinese data over the weekend were ignored. As you can see in the chart at right, which is the VIX over the past 12 months, the markets estimate of volatility


Macro Morning: King dollar returns

The US dollar is doing something very strange at the moment. Well, not that strange, after all it’s really just something that we haven’t seen for a while. That is, the US dollar seems to be re-establishing a positive correlation with moves in the stock market and is rallying along with the Dow and the


A universally stinky Australian dollar (updated)

Alan Kohler may have joined the elite cheer squad of Australian dollar strength this morning but its all looking in vain at the moment. The Australian dollar looks weak and weakening to me. Today there’s no surprise about why with China’s property bubble going mainstream and the weekend’s property curbs whacking rebar futures big, as well


US budget sequester pressures Australian dollar

From AAP: President Barack Obama has accused Republican rivals of threatening the fragile US economic recovery by failing to move forward on his deficit reduction plan before severe budget cuts kick in. Mr Obama said that by refusing to allow a vote on a Senate bill that includes a balance of tax revenue and targeted


Australian dollar too hard for the RBA

Cross-posted from FTAlphaville. Strong currencies are the bane of every triple-A rated, QE-less economy in currency war-torn 2013, it seems. It’s become an increasingly irksome point in Australia, where the initial exuberance over cheap foreign holidays has been slowly replaced by worries that it’s squeezing the non-mining sectors. An FOI request by Bloomberg yielded a bunch of documents from


RBA: Australian dollar 4-15% overvalued

The RBA has released a goldmine of analysis on how overvalued is the Australian dollar following a freedom on information request (God knows why this is not on the public record anyway. The market response was obvious though brief, above). The bottom line is that RBA reckons: Most models – including the staff’s internal models


Gillard joins the Australian dollar boosters

From BS, Julia Gillard joins the cavalcade of officials seeking to boost the Australian dollar: “We can still be a country that manufactures things. But we’re going to have to do it differently…The dollar is likely to stay high for some period of time.” …”The competitive disadvantage of the high Aussie dollar is obvious but


Macro Morning: Australian dollar safe haven’t

The uncertainty caused by the Italian elections continued to reverberate around markets overnight with European stocks under pressure and the US dollar and gold benefiting materially from the malaise. The election result seems to have come as somewhat of a surprise to the established players and clearly also the markets. Stocks in Milan fell 4.9%


Macro Morning: Risk aaaaaaawf

In 2010, 2011 and 2012 the problems of Europe hit the markets in late April and early May. I have been expecting something similar again this year given that the euphoria of the near death experience Europe is starting to give way to a recognition that the Eurozone economy is in dire straits still. The


Macro Morning: Itaaaallllyyyyyyyy

Nothing really matters this week except for the outcome of the Italian Elections which will start to filter out in Asian time today and then Bernanke’s walk up the Hill to give his testimony to the US Congress. On the former it is in the hands of the Italian people what happens but regarding the


Cap’t Glenn: Rates targeted the Australian dollar

RBA boss Glenn Stevens is in Parliament today for his annual testimony. Find below his opening statement which is noteworthy for its glass-half-full approach to the mining growth hand-off and his confession that interest rates have targeted the dollar in some measure. Sadly, markets interpreted the balance of these two arguments as bullish and added the better


Macro Morning: Fed caps stocks

It was a big night for currencies and commodities but there is a real risk now for stock bulls that the FOMC just put a lid on the recent rally. The FOMC Minutes which came out at 1700 GMT or around 6am Sydney time and showed a recognition that the flow of easy money can


Macro Morning: German hope rocket

Stocks were driven higher by the much better than expected ZEW sentiment survey in Germany with a big bounce from 31.5 to 48.2 this month for a much better result than the 35 the punditry were expecting. The Eurowide ZEW survey was equally amazing coming in at 42.4 from 31.2 last. How business sentiment has


RBA & Treasury push for higher Australian dollar

The new and outspoken RBA board member, Heather Ridout, yesterday added the RBA’s voice to keeping the dollar elevated. From the AFR: “The Japanese election and statements by politicians had contributed to a significant depreciation of the yen since November.” Fair enough. We all know that the jawbone is a powerful tool for the senior


Macro Morning: Silent night

A boring a night for stock investors with the US out and Europe a bit mixed. The FTSE fell 0.16%, the DAX was up 0.47%, the CAC rose 0.18% while Milan and Madrid both slid 0.51%. The Italian elections are coming up fast so that might be a cause of market angst again soon depending


Industry policy cannot offset the Australian dollar

The Gillard government has released its new industry policy blueprint and it looks reasonable enough. Although Business Spectator gives it a caning, more even-handed analysis is available from Peter Roberts at the AFR: The extra $350 million to support innovation investment funds (IIFs) is a bold recognition that there remain market failures in our venture


Macro Morning: Walmart crash

Friday night was mixed with UK retail sales tanking 0.6% versus an expectation of a rise of 0.4% in January. US industrial production was also weaker than expected falling 0.1% in January against an expectation of a rise of 0.2% but the New York State Empire manufacturing survey was up sharply  to 10 from -7.78 last